Building approvals suffered a sharp decline in September ABS data released yesterday revealed.
Total dwelling units fell 7.2 per cent month on month and more than 20 per cent compared to September 2007 to total 11, 167.
Building approvals for units have seen the biggest decline over the year, now sitting 31.5 per cent lower than in September 2007.
Peter Jones, Master Builders chief economist, said the housing slide posed a major threat to the national economy.
“Aggressive fiscal and monetary policy should help to minimise the risk of a severe economic downturn, however soft conditions in the housing market can be expected over much of calendar 2009, despite the government’s stimulus package and the RBA’s aggressive rate cuts,” he said.
“The latest slide in housing points to the need for more rate cuts in coming months,” he said.
The Housing Industry Association (HIA) said greater efficiency in planning and administration as well as reduced charges and levies would be necessary to kick start building activity.
“Urgent action in sorting out land release, infrastructure servicing and planning delays are now essential in ensuring a recovery in building activity in residential construction,” HIA chief economist Harley Dale commented.
HIA has forecast the national dwelling shortage to blow out to as much as 85,000 by the end of the 2009 financial year.
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